A balance of payments crisis is unlikely in today’s Asia. Most countries have improved their current accounts and FX reserves. The rising debt load may however pose problems, although it nowadays is mainly local currency denominated.

Strong economic growth has diminished poverty in the region and will swell the ranks of the middle class. But corruption levels are high, China’s influence in the region is increasing and the dispute surrounding the South China Sea may generate stability risks.

Demographics will provide headwinds in the developed countries of APAC and China, and tailwinds in South Asia. While total factor productivity growth has fallen, the innovation outlook for the APAC region is still relatively favourable.

Brunei is dependent on the hydrocarbon sector, but it gives the country a comfortable external position and allows the government to be generous to the population. As a result, there is little dissatisfaction with the slow democratization process.

Brunei's hydrocarbon-based economy has embarked on a gradual economic recovery and should benefit from strong Asian demand for its exports, as Japan is shifting its energy mix in the aftermath of the Fukushima nuclear disaster.

The prosperous country of Brunei derives its wealth from an abundance of oil and gas resources. The economy contracted 1.8% yoy in 2009 and is estimated to have grown over 1% in 2010, on the back of higher global commodity prices